Long-dated Treasury bonds produced a gain of +46.4% (total return) on a trailing 1-year basis as of the close of trading last Monday 3/09/20 (source: Barclays).

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The average interest rate nationwide on a 30-year fixed rate mortgage was 3.74% at the end of 2019.  The record low national average was 3.31% as of 11/22/12 or just over 7 years ago (source: Freddie Mac).
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The Fed has had 8 “tightening cycles” in the last 50 years (i.e., since 1969), including the most recent cycle that included 9 rate hikes through 12/19/18.  During 6 of the 8 “tightening cycles” over the last 5 decades, the S&P 500 was “up” on a total return basis, including the last 4 cycles (source: BTN Research).

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The median sales price of a new home sold nationwide in October 2019 was +17% more expensive than the median sales price of an existing home sold nationwide in October 2019, i.e., $316,700 for a new home vs. $270,900 for an existing home (source: Census Bureau, National Association of Realtors).

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In 2016, 46% of American homeowners ages 65-79 had outstanding mortgage debt on their primary residence, almost double from the 24% of this age bracket that had mortgage debt 30 years earlier (source: Joint Center for Housing Studies of Harvard University).

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The Fed lowered short-term interest rates last Wednesday (10/30/19), its 3rd consecutive meeting that has resulted in a rate cut.  That’s the first time the Fed has reduced rates over 3 straight meetings since 12/16/08 or nearly 11 years ago (source: Federal Reserve).

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The 111.2 million households that existed in the United States on 9/30/09 were split 68/32 between 75.2 million owners and 36.0 million renters.  The 122.7 million households in the United States on 9/30/19 were split 65/35 between 79.5 million owners and 43.2 million renters (source: Census Bureau).

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The average loan-to-value ratio in the US housing market as of 6/30/08 was 55%, i.e., the average homeowner had home equity of 45%.  The average loan-to-value ratio in the US housing market as of 6/30/19 was 36%, i.e., the average homeowner had home equity of 64%(source: Federal Reserve).

 

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As of 12/17/18, 10 Wall Street strategists predicted where the yield on the 10-year T-note would be as of 12/31/19.  All 10 forecasted an increase in the 10-year note yield from its actual 12/31/18 yield close of 2.68%.  However, the yield on the 10-year note has fallen to 1.50% as of Friday’s close 8/30/19 (source: Barron’s).

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If the nation’s aggregate net worth of $113.5 trillion was spread equally across all 122.5 million US households, every American household would be worth $927,000 (source: Federal Reserve).

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